Finding innovation

Becoming a leader who fosters innovation is an issue that confronts many CEOs. European CEO talks to Jonathan Vehar and David Magellan Horth, thought leaders at the Center for Creative Leadership and co-authors of a paper about the qualities needed to run innovative organisations


What, in your experience, are the most common obstacles to innovation in everyday business?
DH: There is a pervasive fear of failure and thus a fear of taking risks. People are encouraged to perform well, but within the strategy of the organisation. Innovation requires people to come forth with ideas and to execute these even when the outcome is not guaranteed. In a typical case, an employee comes forth and the manager is faced with the dilemma that the idea – however good it is – does not fit the objectives set for her or him, or for the employee. Faced with this, strategy is favoured and the manager often crushes both the idea and the person who generated it.

How should a CEO ensure that innovative ideas are given a fair chance?
JV: We advocate creating a culture where people focus first on the strengths and advantages of an idea, so that as it evolves and develops it maintains these positive aspects. What often happens is that, as an idea meets with critiques and ‘devil’s advocate’ responses, it slowly becomes de-risked and de-innovated. It devolves into a slightly modified version of what is already being done.

This happens especially when an idea is filtered up through the organisational hierarchy. A CEO should ensure that critiques of ideas also include a process for fixing problems with supplementary suggestions, rather than using flaws as an excuse to kill them, and using failure as a learning experience – eventually shifting from the approach of ‘trial and error’ to ‘try, err, and learn.’

What does a CEO have to do to develop a lasting creative culture?
JV: This is an important question, since culture trumps strategy. This means that not only is culture an enabler of strategy, but if the culture doesn’t support the strategy, then it will go down in flames regardless of the intense personal will of the CEO.

Is there an incompatibility between being a strong business manager and being  a creative leader?
JV: Not an incompatibility, but they are separate and distinct skill sets that require different ways of thinking. Where managing the business focuses on facts – what is known – and how to run the existing operation more efficiently, creative leadership requires a focus on possibilities – what could be – and looking at ways to disrupt the current processes and outputs of the organisation. We talk about it as a difference between ‘business thinking’ and ‘innovative thinking,’ and they’re both necessary for sustainable competitive advantage.

How do you encourage people to be comfortable with ambiguity?
DH: Leadership, let alone leadership for innovation, demands the skill of leveraging ambiguity and the inherent polarities as a major source of innovation. Leadership for innovation demands the use of both strategy and ideas that challenge the strategy.

Does the creation of multicultural teams help the innovation process?
JV: Multicultural teams make the innovation process more difficult and time-consuming, but vastly more productive than working with a mono-cultural team where everyone sees things the same way. This applies to mixing cultures, functions, generations, education, levels of hierarchy and so on. Groups with different perspectives, when working properly and with respect for each other, generate creative friction that can cause a spark and ignite innovation.

Where should the innovation process start – in the organisation or in the marketplace?
DH: In my experience it’s about the two connecting. Ultimately, an idea that leads to the creation of new products and services has to connect with the market, and in many cases transform or create new markets. I’ve found that where ‘market driven’ implies current market wisdom and seeks to generate innovations based on current knowledge of the existing market, innovations will tend to be add-ons, and refinements to products and services that already exist. More radical innovations tend to come from the grass roots and from outside the organisation – from customers and external stakeholders – because they challenge current wisdom.

How does one bridge the gap between creative thinking and effective execution?
DH: In a conversation we had many years ago when he was innovation director at Eastman Kodak, Bob Rosenfeld, a wise friend of mine at Idea Connections, described innovation as about connecting ideas with ideas, ideas with people and people with people. I believe that innovation is ultimately a social process requiring navigation of the politics surrounding ideas that don’t at first appear to be of value to an organisation but ultimately help transform the very strategy that they didn’t seem to fit.

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